Amazon\’s next \’Fire\’: a credit-card reader?

For Amazon, \”Fire\” has been the keyword of the year. In the first half , the online retailing giant moved to command more of the consumer electronics market with its Fire TV set-top box and its Fire smartphone to go along with its Kindle Fire HDX tablet.

So…maybe a Fire credit card reader is in the works?

Reports surfaced Monday that Amazon
is on the brink of rolling out its own branded card reader to take advantage of the mobile-payments market that Gartner Inc. has forecast will grow 35% annually to $721 billion by 2017 from $325 billion in 2014.

Such a move, according to 9to5mac.com, would pit Amazon against established players such as Square and eBay Inc.\’s PayPal
. It\’s easy to see why Amazon would consider launching its own credit-card reader. The company is already a giant in e-commerce, and its forays into its own consumer electronics have given it a stake in the offline world of mobile and home devices.

The market for electronic payments continues to grow. PayPal, for example, reported 29% growth in total payment volume to $55 billion in eBay\’s second quarter, and a 20% increase in revenue to $1.95 billion.

Square, which is privately held and expected to go public in the near future, doesn\’t disclose its revenue figures.

Michael Pachter, of Wedbush Securities, was cautious about the outlook for companies, particularly Square, in the electronics payment market.

\”Square has a niche, that is rapidly evaporating, in processing transactions for small vendors who aren’t equipped to deal directly with Visa and Mastercard,\” Pachter said. \”PayPal had been dominant in that niche, but Square gave small vendors the ability to collect at point of sale, while PayPal has historically been online only [and] migrating to a virtual wallet.\”

But, would an Amazon credit card reader be a boon to the company? Not necessarily, according to some analysts that follow the company.

\”If true, it\’s not clear that this will have material, direct financial impact on Amazon in the next five years,\” said Carlos Kirjner, of Bernstein Research. \”It is possible, in theory at least, that this may be a play for customer data, but I suspect neither merchants nor customers would like that a lot.\”

We asked Amazon about the possibility of it its own credit card reader. A company spokeswoman said, \”we don\’t comment on rumors and speculation.\”

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